Starting An Online Business: What Works And What Not
750,000+ Small Business Websites Selling Online
Undeniably, Internet has grown incredibly fast in such a relatively short period of time.
In U.S. there are 290 million Internet users. Worldwide, there are 3.25 billion people online.
Internet offers conveniences like never before. You can sell and buy goods and services 24 hours a day 7-days a week, from anywhere in the world without leaving your house.
This makes the Internet, the most powerful tool for business in human history, even more than the telephone or the Television.
Are you considering the possibility of starting an Internet-based business for selling products/services online?
Consider this.
Retails sales have grown about 2% to 3% in the last few years. During the same time, online sales have grown between 15%-25%, even during the recession.
Industry analysts estimate the growth of online shopping from the current $1 trillion to more than $2.1 trillion by the year 2027. If you are thinking of starting a business, there is hardly any industry that can match that kind of growth.
While the opportunity for growth is enormous the major benefit of an online business is the relative low cost of startup.
There is no need for a store. There is no need to sign a lease on a property, office, or factory. There is no need to pay for utilities, furniture, stationary, printed brochures and other such overheads and expenses.
Despite the low startup cost, you actually have access to much bigger market than you would if you had a local shop on a high street or in a mall. A retail outlet store would only be able to be accessible (in most cases) during the normal office hours and available to the local population or people that can physically be there at the store.
But with an online business, you can sell to anyone, anywhere in the whole world, and have no office hours that would strict the access to your physical location and hence your products or services.
You can have a Website that can sell 24hours a day, 7 days a week to anybody in the world, even in your sleep.
You do not need to have a retail office which will save you lots of money that you otherwise would spend on a lease, utility fees, and other overheads. Your Website will act as your retail office, your factory space, inventory cataloging system, AND also acts as your salesperson and cashier selling and processing orders for your business. That is why a Website is the most important aspect of your online business presence.
Here's expert advice to help you start, build, manage, and grow your online business:
1. Decide on the product and/or service you want to sell online.
To succeed at a new venture, such as starting an online business, it is always a good idea to talk to someone who has done it before and has succeeded. For the writing of this article I contacted Anaxstar Corporation's Michael Edmonds, one of the leading online business startup consultants for his insight into building a successful online business. Michael has started more than 20 small Internet businesses since 1995 and has taken 2 of them public, and is regarded as one of the leading Internet business entrepreneurs. He is a co-founder and a consultant for Anaxstar Corporation and in his capacity as a consultant, he has helped more than 2,000 Internet startups with their business strategy, revenue model, venture capital, Website promotions, product mix, and marketing.
I asked Michael about the best product that can be sold online, and he replied: "Starting an online business is like solving a puzzle. This puzzle has many pieces, and I think you have to start with the first piece, which is yourself and (if it applies) your partner or partners. Understanding yourselves is absolutely essential. Because if you don't know and understand your own skills and what you want to achieve then you never know what is possible. It's like driving from Los Angeles to New York without a map and not even knowing if you or your partner can drive a car. While you spend the time and effort to understand yourself, what you want from a career, and what is your value system, and how you want to live your life - you will start to put the pieces of the puzzle together. Soon you will discover what your life's mission is. I, for instance, enjoy helping other people suceed with their business dreams. That is my life's mission and that is why I am part of Anaxstar. Once you have discovered your goals and dreams, then you will need to clearly understand what you are best at producing. Everyone has something to contribute because our lives have made all of us very unique so each of us can offer something in a particular way and under certain circumstances that no one else can. May be you can offer a service that is high in demand and others need in order to succeed with their goals and ambitions. May be the service you can provide is sourcing the best product for the cheapest price and bringing it to market for a highly competitive price. You can put all the pieces of the puzzle together once you begin to look at yourself and understand your life's mission. The one suggestion I always recommend for people is, to not be overly critical and overly judgmental of the past performances. The past is only that - the past. Everything you have learnt has brought you to this point in your life. But tomorrow is unknown and you could still create your masterpiece and still achieve what you never thought would be possible. Give yourself the chance to offer your best, be it a direct service to others or a service of sourcing and value-added product retailing online or even building, creating, manufacturing, or developing something new that is innovative which no one had thought of before or no one had yet marketed online."
From my conversation with Michael, I learnt many things about starting an Internet business. You don't need to start big and spend lots of money to start an online business. You can start part-time and operate your new business from your home where you have most of the things you need (Internet access, PC, and a phone). You can conduct research on products, markets, trends, competition, and demand right from your chair.
I discovered that there are many products that can be sourced and sold online because people either don't have the time to search for it and find it and go and get it themselves. This means that you can offer a service that is of value to other people and they will pay for it. I think this is where everyone can start from when deciding on what kind of a product they want to offer in their new business venture.
Once you have a product or service that you want to offer to customer, which you feel strongly about and believe you can succeed at selling, then you need a Website to reach people and market and sell your product or service.
2. Domain Name selection and registration.
To have a Website online, you will first have to decide and obtain a domain name for your Website, which can also represent your business name for branding purposes.
If you want to have a serious online business then you need to get your own dedicated domain name on the Internet that represents your Website address.
Choosing a domain name carefully is very important. If you think that you may not be up to this challenge, then I suggest you get some assistance or consult with a professional on searching and selecting the best keywords and the best domain name that would represent your business concept and strategy as well as future marketing campaign.
Not everybody is an expert at selecting or choosing the most ideal domain name. There are many things to consider such as branding, recognition, retention, and marketability. If you think you may need the help of a professional, I suggest you get some help from a domain name marketing consultant. This is very, very important for the future success of your online business.
When deciding on a domain name, consider using Google Keyword and Adword tool to help you identify what search words are used by both your potential customers (Web traffic based on search engine keywords) as well as your competitors. You can take a look at your competitors and see what search words they have used for Search Engine Optimization and research these keywords until you come up with a phrase and set of keywords that best describes your business offering and/or your competitive value advantage. If you are offering the lowest priced bamboo sheets, then may be your domain choice would be "AffordableBambooSheets.com". If you are offering the fastest iPhone application, then may be your domain choice would be "fastestIphoneApp.com", etc.
You can derive your final domain name based on a list of primary keywords and secondary keywords that you have compiled which best represent your business model and your value advantage.
Once you have done so, then you are ready to buy your domain name. Remember, if you think that may be you have a list of 3 or 4 or even more domain names that may represent your business model then why not consider buying all the domain names for now and deciding later which one will be your main business domain name. The price of a domain name per year is quite low, around $10 per year from a domain registrar (except Network Solutions which charge about $30 per year - for no particular reason or additional service for this increased price). If you don't want to buy your domain name from a registrar, then you can buy it through a hosting company. See below.
3. You will need a hosting service.
To have an online business, you will need to have a Website.
To have a Website online, you will need a domain name and a hosting service where your Website can reside under your business domain name.
There are many hosting service companies here in U.S. as well as the rest of the world that offer a variety of hosting services. We recommend that you use a U.S. based hosting service since the IP address (your Internet address) will be partially important when it comes to your site's search ranking in the search engines (Google, Bing, Yahoo, etc.).
The search engine ranking of your Website is very important since it will affect your search engine optimization (SEO) and how Internet users find you which results in increase of traffic to your Website, and ultimately your sales. Without traffic, you will not have the option to sell to many online users.
In my opinion these are some good hosting companies that I have used in the past or my clients have used in the past. I have also provided an overall ranking based on their service quality, price-value, technical support services, range of services offered, and most importantly, support accessibility and availability.
The most important feature of your hosting service, in my opinion, is having access to technical support and how the hosting company allows you to access the support department (e.g. via Live Chat, or free-toll 800 number 24/7, etc.) and the quality of the support staff that you have access to.
I could have provided a list of at least 20 (or may be more) hosting companies for you below. But these are the ones that I would regard as ones I'd recommend to an online business starter or an existing online business.
There are far too many features to list for a particular hosting service. Not all features are needed but there are a few that are key: 1) fast servers, 2) dedicated IP address for your Website for SEO reasons, 3) capability to host multiple Websites, 4) unlimited bandwidth, and 5) unlimited space.
The list I provided below is based on what I anticipate as services that most startup businesses and Websites would need in the first 5 years of their business hosting needs.
You can contact these companies for additional information and decide if they are the best service and most suitable company for your exact needs.
4. Build a professional Website that you want to represent your business and your products.
Your site represents your business. Therefore you need to have a Website that is well designs, easy to navigate, intuitive, clearly written and hopefully with large-enough text that is easy to read, and quick to download and view. Photos, images, audio, and video should be formatted correctly to make every aspect of your site able to impress your potential online customer.
According to Brian Drexler, VP of Marketing at Anaxstar Corporation, "A Web site represents a company's identity and illustrates their business intelligence and why a customer should do business with them instead of a competitor. If you want to succeed with your online business you absolutely need to have a clearly presented Web site to your target audience and potential clients. This does not have to be expensive and there is no need for fancy flash videos to impress your online visitors. You do need to let your online visitors learn of your offerings within a matter of seconds without having to read for 5 minutes just to understand what that Web page is trying to sell".
If you offer products or any kind of a service, even contractors and freelancers, you will need a Website that represents and promotes your business. A Website is now a must for any business owner whether small or medium or a big company.
Anaxstar Web Design Services Department has a formula they use when custom building a Website for their customers. They have provided their main template, below, for your viewing.
Website Strategy
First you can start from the basics. Describe what you want to accomplish. Ask yourself what it is that you are intending to do, how you want to do it, and what you want the end result to be. Here are some questions that will guide your through your thoughts, ideas, objectives and goals:
What is your big idea (business idea)?
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What products or services do you want to offer/sell?
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What is the best possible strategy for your business idea?
You will need to come up with a clear strategy, in writing, describing what you want to achieve and how you wish to accomplish your goals. Once you have a clear strategic direction with clearly defined ideas, then you can focus on details.
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What your specific Website objectives?
Ideally, you want your Website objectives to be clear, concise, specific, measurable, realistic, and achievable. For instance:
Single Product (or Service) E-commerce Shopping Cart
Multi-Product (Services) Corporate E-commerce Storefront
Company / Product / Service Branding
Product / Service Informational Website
Turning Online Visitors into Buyers
Converting Prospects into Customers
Blogging / Forum / Informational Website for Advertising Revenue Model
Other: __________________________________________________________
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Who are your audiences?
It is important to know who your target audience are. If you ware targeting consumers then your Website would be designed differently for a strategy of business-to-consumer strategy. If you Website is targeting retailers, or other businesses then your Website would be designed based on a business-to-business target audience strategy. Once you have decided on a primary target audience, then you may want to ask yourself if there is a secondary target audience. For instance, you may want to target consumers for products and services that you offer while your secondary audience would be potential businesses and affiliates or partners that use your Website to either advertise or offer companion products and services.
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Who are your primary target audience?
Once you have decided on your primary target audience that would be ideal candidates for your business offering, then you want to understand your audience as clearly as possible and be aware of their needs and requirements. Complete a customer profiling sheet.
Describe your primary target audience: (demographics, needs, objectives, insights, market trends, and anything else that you can think of regarding their characteristics).
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Who are your secondary target audience?
Once you have decided on your secondary target audience that would be ideal candidates for your business offering, then you want to understand your audience as clearly as possible and be aware of their needs and requirements. Complete a customer profiling analysis study.
Describe your primary target audience: (demographics, needs, objectives, insights, market trends, and anything else that you can think of regarding their characteristics).
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Website visitors question list?
Perform a brainstorming session with a friend or a business colleague and ask yourselves what questions would your target audience and Website visitors would possibly ask when they visit your Website. This role-playing will help you to understand and anticipate what your Website visitors' perspective would be and help you design your Website from their concerns and their perspective.
General Website questions:
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Product / Service questions:
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Support / Customer Service questions:
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Product shipping, delivery and fulfillment questions:
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Returns policy, privacy policy, terms and conditions:
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Why buy from you? What is your differentiation compared to competitors:
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What is your quality-value-price proposition compared to other competitors:
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How to proceed with purchasing online:
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Security, online order placement, credibility, and other questions and concerns:
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Once you have asked yourself what your potential customers want, then you can begin to match customer requirements and expectations to the type of audience you can capture based on the traffic that is landing on your Website.
Where is your traffic coming from?
You need to decide at an early on what traffic source you want to target:
Search Engines (mainly through Search Engine Optimization)
Directly from entering domain name of the business
Direct or Opt-in email campaigns
Social Networking
Online content spreading (blogs, forums, news opinion/comments, etc.)
Affiliate sites; partner promotions and campaigns
Online advertising (including banner ads, ezine ads, media ads, etc.)
Other ____________________________________________________
And Finally:
It is essential to have a clear business idea and have had a though provoking brainstorming session to evaluate your ideas for your business venture. If you have a feeling of excitement and an abundance of energy that makes you want to jump right into it and start without delay, then the chances are you will probably succeed. Since failure will never deter you and it is what you learn from your failure that will act as a blueprint for your future success.
Your business strategy exercise will act as seeds that will propel your business when you have both challenges and opportunities and help as a means of decision making and communication process both internally and externally (i.e. help you convince colleagues about the direct of your Website strategy while helping you develop content for your target audience).
Once written down and clearly described, you have a measurable accountability and the metrics against which you can evaluate results with concise traceable components as the building blocks of your online business.
When you are finished with your initial business analysis, strategy formation, opportunity assessment, planning, target audience, and communication strategy - which may take a little time to complete - you are indeed poised for success of your own Internet business.
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